Reserve is an international investment plan that Friends Provident International claims is suitable for customers with a lump sum to invest for a minimum of five years, who seek capital growth or regular withdrawals, or a combination of both.
Reserve is available to those who are aged 18 and over. If the plan has lives assured, the minimum age is 2 years old and at least one life assured must be
80 or younger.
The Reserve Investment Bond requires you to invest a lump-sum payment of at least GBP 50,000. This needs to be invested for at least 5 years or an early cash-in charge may apply.
The Reserve Bond has two plan options:
Features of Reserve Investment Bond:
The establishment charges of Friends Provident International's Reserve Investment Bond would depend on whether you have appointed a DFM (Discretionary Fund Manager) or not. Let's have a look at what it would be without a DFM:
| Currency | No discretionary fund manager appointed | Annual policy charge option | |
| Whole of life | Capital redemption | ||
| GBP | 50,000 | 100,000 | 100,000 |
| USD | 75,000 | 150,000 | 150,000 |
| EUR | 75,000 | 150,000 | 150,000 |
| HKD | 600,000 | 1,200,000 | 1,200,000 |
| AUD | 150,000 | 300,000 | 300,000 |
| JPY | 10,000,000 | 20,000,000 | 20,000,000 |
| SEK | 650,000 | 1,300,000 | 1,300,000 |
| CHF | 125,000 | 250,000 | 250,000 |
If you later wish to add to your plan, the minimum additional payment is as follows:
| Currency | Establishment charge option | Annual policy charge option |
| GBP | 5,000 | 10,000 |
| USD | 7,500 | 15,000 |
| EUR | 7,500 | 15,000 |
| HKD | 60,000 | 120,000 |
| AUD | 15,000 | 30,000 |
| JPY | 1,000,000 | 2,000,000 |
| SEK | 65,000 | 130,000 |
| CHF | 12,500 | 25,000 |
Friends Provident International's Reserve also has two investment options, namely:
1. Collective investments:
Under collective investments, you can invest your money in the following:
2. Personalised assets:
Under this investment option offered by FPI, you can invest your money in:
You can exchange existing assets into your plan which comply with the structures. The minimum value of an asset to be exchanged into your plan is GBP 5,000 (an asset exchange charge will apply).
NOTE:
We would recommend reading the expert verdict section of this review to understand why our experts gave Friends Provident International's Reserve Investment Bond 3 out of 5 stars in this independent review.
Additionally, here's a free guide that can help you achieve better results. In this guide, you'll learn:
Like many other offshore investment bonds, we have seen (all too often) the FPI Reserve Bond being used or sold to investors within QROPS and SIPPs.
This is done in order to generate more commission for the salesperson.
The FPI Reserve Bond should not be used within a QROPS or SIPP, because when you start to draw on your pension, the charges may still apply on the original investment, which effectively means your charges will go up as the capital decreases - and will erode some of the remaining capital at a quicker rate.
In short, used in the right circumstances, offshore bonds can provide attractive tax benefits (but definitely not within SIPP or QROPS).
However, in many instances, they can be mis-used by commission based salespeople to extract high levels of commission. Our advice is to incept such a plan only after receiving advice from a fully regulated UK- qualified financial planner, and to opt for a cleanly priced option without any form of establishment charge or lock-in period (zero-exit penalties).
If you already have a Reserve Offshore Investment Bond from Friends Provident International, and it is worth £500,000 or more, we strongly recommend you seek a Second Opinion to ensure you are on track to get and keep the life you want.
There's every chance you're paying far too much for an inappropriate product. Learn more from our deep dive into Friends's Provident International's Reserve Investment Bond.
